Source · Select Committees · Public Accounts Committee
Recommendation 27
27
Accepted
Department provided limited oversight and influence over ECO4 and GBIS schemes.
Recommendation
The National Audit Office reported that the Department designed both ECO and the consumer protection and quality assurance system to operate at arm’s length from government, and that the Department gave itself limited oversight and influence of ECO4 and GBIS. It concluded that the Department and Ofgem took quick action but this was only after TrustMark shared its analysis of high levels of non-compliance with quality standards in external wall insulation in October 2024.56 Witnesses at our oral evidence session indicated that other information should have alerted the Department to the issues much earlier.57 The National Audit Office concluded that the Department did not fully use the levers it did have to oversee ECO4 and GBIS, and that its poor oversight of the schemes meant senior officials assumed the quality assurance system was working when it was not.58 The Department accepted that it should have been more questioning and given the schemes more oversight, and that there were not enough installation checks.59
Government Response Summary
The government will publish an annual report to Parliament on its retrofit schemes, their level of non-compliance and estimated fraud, and whether the schemes are working as intended, starting before Autumn 2027. This will be included in the department's Annual Report and Accounts.
Government Response
Accepted
HM Government
Accepted
5. PAC conclusion: The Department’s system of quality assurance and consumer protection was far too complicated, and organisations within it focused too much on their own tasks rather than whether the system was protecting consumers. 5. PAC recommendation: The Department should publish an annual report to Parliament on all its retrofit schemes, their level of non-compliance and estimated fraud, and whether the schemes are working as intended. 5.1 The government agrees with the Committee’s recommendation. Target implementation date: Autumn 2027 5.2 The department will publish an annual report to Parliament on retrofit schemes, with the first publication before Autumn 2027. To align with the National Audit Office recommendation, this will be included in the department’s Annual Report and Accounts. The department’s Annual Report and Accounts sets out DESNZ’s approach to managing fraud and error, including counter-fraud governance and capability, risk management across major schemes. 5.3 The department has assessed the quality assurance processes in use across retrofit schemes to establish which quality metrics are currently being measured and how frequently. Based on the lessons learned from ECO4 and GBIS, the department intends to establish a standard methodology for measuring and reporting on error and fraud, which will be used for all new schemes. Where it is feasible and represents value for money to do so, the department will assess existing retrofit schemes against this methodology.